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Quanta Services Inc (NYSE:PWR)
Beneish M-Score
-2.27 (As of Today)

The zones of discrimination for M-Score is as such:

An M-Score of less than -2.22 suggests that the company is not an accounting manipulator.
An M-Score of greater than -2.22 signals that the company is likely an accounting manipulator.

Quanta Services Inc has a M-score of -2.27 suggests that the company is not a manipulator.

PWR' s 10-Year Beneish M-Score Range
Min: -3.33   Max: -1.18
Current: -2.27

-3.33
-1.18

During the past 13 years, the highest Beneish M-Score of Quanta Services Inc was -1.18. The lowest was -3.33. And the median was -2.44.


Definition

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Z-Score) or business trend (F-Score), M-score can be used to detect the risk of earnings manipulation. This is the original research paper on M-score.

The M-Score Variables:

The M-score of Quanta Services Inc for today is based on a combination of the following eight different indices:

M=-4.84+0.92 * DSRI+0.528 * GMI+0.404 * AQI+0.892 * SGI+0.115 * DEPI
=-4.84+0.92 * 1.0935+0.528 * 1.0262+0.404 * 0.9224+0.892 * 1.194+0.115 * 1.0026
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.1587+4.679 * 0.0075-0.327 * 1.1075
=-2.27

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

This Year (Sep14) TTM:Last Year (Sep13) TTM:
Accounts Receivable was $1,873 Mil.
Revenue was 2171.144 + 1864.55 + 1762.574 + 1817.623 = $7,616 Mil.
Gross Profit was 352.971 + 281.448 + 272.071 + 302.843 = $1,209 Mil.
Total Current Assets was $2,536 Mil.
Total Assets was $6,229 Mil.
Property, Plant and Equipment(Net PPE) was $1,388 Mil.
Depreciation, Depletion and Amortization(DDA) was $188 Mil.
Selling, General & Admin. Expense(SGA) was $657 Mil.
Total Current Liabilities was $1,128 Mil.
Long-Term Debt was $83 Mil.
Net Income was 94.648 + 81.082 + 54.408 + 166.697 = $397 Mil.
Non Operating Income was -0.378 + -1.233 + 0.643 + 113.299 = $112 Mil.
Cash Flow from Operations was 64.119 + 32.756 + -60.533 + 201.492 = $238 Mil.
Accounts Receivable was $1,435 Mil.
Revenue was 1645.132 + 1474.377 + 1585.71 + 1673.342 = $6,379 Mil.
Gross Profit was 273.053 + 241.284 + 238.273 + 286.739 = $1,039 Mil.
Total Current Assets was $2,137 Mil.
Total Assets was $5,495 Mil.
Property, Plant and Equipment(Net PPE) was $1,154 Mil.
Depreciation, Depletion and Amortization(DDA) was $156 Mil.
Selling, General & Admin. Expense(SGA) was $475 Mil.
Total Current Liabilities was $965 Mil.
Long-Term Debt was $0 Mil.



1. DSRI = Days Sales in Receivables Index

Measured as the ratio of days’ sales in receivables in year t to year t-1.

A large increase in DSR could be indicative of revenue inflation.

DSRI=(Receivables_t / Revenue_t) / (Receivables_t-1 / Revenue_t-1)
=(1873.241 / 7615.891) / (1434.701 / 6378.561)
=0.24596479 / 0.2249255
=1.0935

2. GMI = Gross Margin Index

Measured as the ratio of gross margin in year t-1 to gross margin in year t.

Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more likely to manipulate earnings.

GMI=GrossMargin_t-1 / GrossMargin_t
=(GrossProfit_t-1 / Revenue_t-1) / (GrossProfit_t / Revenue_t)
=(281.448 / 6378.561) / (352.971 / 7615.891)
=0.16294412 / 0.15879074
=1.0262

3. AQI = Asset Quality Index

AQI is the ratio of asset quality in year t to year t-1.

Asset quality is measured as the ratio of non-current assets other than plant, property and equipment to total assets.

AQI=(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) / (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
=(1 - (2536.467 + 1388.134) / 6229.289) / (1 - (2137.387 + 1153.629) / 5494.968)
=0.36997609 / 0.4010855
=0.9224

4. SGI = Sales Growth Index

Ratio of sales in year t to sales in year t-1.

Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to manipulate in order to keep up appearances.

SGI=Sales_t / Sales_t-1
=Revenue_t / Revenue_t-1
=7615.891 / 6378.561
=1.194

5. DEPI = Depreciation Index

Measured as the ratio of the rate of depreciation in year t-1 to the corresponding rate in year t.

DEPI greater than 1 indicates that assets are being depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.

DEPI=(Depreciation_t-1 / (Depreciaton_t-1 + PPE_t-1)) / (Depreciation_t / (Depreciaton_t + PPE_t))
=(156.297 / (156.297 + 1153.629)) / (187.513 / (187.513 + 1388.134))
=0.11931743 / 0.11900699
=1.0026

6. SGAI = Sales, General and Administrative expenses Index

The ratio of SGA expenses in year t relative to year t-1.

SGA expenses index > 1 means that the company is becoming less efficient in generate sales.

SGAI=(SGA_t / Sales_t) / (SGA_t-1 /Sales_t-1)
=(656.641 / 7615.891) / (474.637 / 6378.561)
=0.08621985 / 0.0744113
=1.1587

7. LVGI = Leverage Index

The ratio of total debt to total assets in year t relative to yeat t-1.

An LVGI > 1 indicates an increase$sgai= in leverage

LVGI=((LTD_t + CurrentLiabilities_t) / TotalAssets_t) / ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
=((83.186 + 1128.127) / 6229.289) / ((0 + 964.787) / 5494.968)
=0.19445446 / 0.17557645
=1.1075

8. TATA = Total Accruals to Total Assets

Total accruals calculated as the change in working capital accounts other than cash less depreciation.

TATA=(IncomefromContinuingOperations_t - CashFlowsfromOperations_t) / TotalAssets_t
=(NetIncome_t - NonOperatingIncome_t - CashFlowsfromOperations_t) / TotalAssets_t
=(396.835 - 112.331 - 237.834) / 6229.289
=0.0075

An M-Score of less than -2.22 suggests that the company will not be a manipulator. An M-Score of greater than -2.22 signals that the company is likely to be a manipulator.

Quanta Services Inc has a M-score of -2.27 suggests that the company will not be a manipulator.


Related Terms

Altman Z-Score, Piotroski F-Score, Accounts Receivable, Revenue, Gross Profit, Total Current Assets, Total Assets, Property, Plant and Equipment, Depreciation, Depletion and Amortization, Selling, General & Admin. Expense, Total Current Liabilities, Long-Term Debt, Net Income, Non Operating Income, Cash Flow from Operations


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Quanta Services Inc Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 0.96571.09231.10051.0510.77640.9861.0181.08390.98010.9835
GMI 1.0910.80660.93270.91830.96120.9391.10121.21270.84560.9789
AQI 0.99590.92260.80662.01840.94380.94431.04110.99950.86741.0661
SGI 0.99011.13261.14511.2591.42330.87781.09381.15551.41171.1018
DEPI 0.92220.98661.01181.33160.83411.18470.9611.03630.98211.1101
SGAI 0.97960.95940.85011.05260.90391.15040.90090.94970.91191.0456
LVGI 0.98360.97021.00220.58280.60650.93690.76261.4421.03121.0509
TATA -0.1067-0.0342-0.0295-0.0244-0.024-0.0523-0.0186-0.01810.0386-0.027
M-score -2.97-2.56-2.48-1.78-2.34-2.89-2.31-2.37-2.08-2.53

Quanta Services Inc Quarterly Data

Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14
DSRI 1.07371.04920.98010.87170.90790.83190.98351.07871.09521.0935
GMI 0.93850.91670.84560.90380.89660.91310.97890.98571.02031.0262
AQI 0.95980.90720.86740.87530.8761.02231.06611.09241.08340.9224
SGI 1.30441.36131.41171.32171.2411.19671.10181.08461.13161.194
DEPI 1.04161.02170.98210.98971.00711.03471.11011.08431.0391.0026
SGAI 0.84750.83540.91190.98961.03881.03741.04561.14761.1061.1587
LVGI 1.43151.3691.03121.00380.91810.87851.05091.05221.06551.1075
TATA 0.00780.03460.03940.02430.019-0.0084-0.027-0.01210.00450.0075
M-score -2.26-2.12-2.08-2.30-2.34-2.50-2.53-2.39-2.24-2.27
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